1.0
Overview
1.1
Definition
The Project Proposal provides a detailed description of a proposed initiative for management consideration. The document describes the Project’s proposed objectives, provides an overview of the Project’s overall scope, key milestones, and high-level approach for handling the business challenge, identifies business impacts, estimated costs, and resource requirements, and ensures Project alignment with KNPC strategic objectives.
1.2
Objective
The objective of the Project Proposal is to assess a Project’s ability to generate its expected value in the long term and ensure alignment with KNPC strategic objectives.
Note: The Project Proposal is the required form for all new business study and technical
initiatives.
1.3
Input
An idea for a new initiative that addresses a specific KNPC business challenge is the key input for the Project Proposal.
1.4
Roles
The Project Proposal is developed by the Project Initiator
The Project Proposal is initially signed-off by Department Head
For business study initiatives, the Project Proposal is assessed by Management Support Department to ensure alignment with strategic objectives, fit within KNPC Journey Map, and timing and prioritisation
For business study initiative, the Project Proposal is presented to the Executive Portfolio Management Committee (CEO + all DCEOs) as part of the Idea Stage Gate Review. Upon authorisation following the review, the Project Proposal is returned to the Project Initiator to finalise. Upon completion, the Project Initiator provides the document to the Management Support Department to facilitate formal signoff from the CEO.
Note: Technical study initiatives are reviewed by Corporate Planning according to current departmental processes.
1.5
Users
Used by the Project Sponsor and the Executive Portfolio Management Committee to validate Project and authorise progression to the Study stage
2.0Completion Process
Section 1: Provide general Project information
Section 1.1: Project Details
Information is requested around:
Project Title : Name of the Project
Initiating Department : Details of the department sponsoring the Project
Sponsor: Name of the initiative’s sponsor.
Project Initiator : Name of the Project Initiator (for the Study Phase and not necessarily
for the entire Project)
Submission Date: Date of Submission of the Project proposal template to Corporate
Planning / Management Support Department.
Budget Reference Number: Each capital project proposal has to be assigned a reference
number denoting the initiating department, together with a reference to the budget year when the project was initiated.
Example: 2013/2/3/04 means that the project is proposed by MAA Refinery (The figure 3 is assigned for MAA Refinery) in 2013/2014 budget and is given a serial number of 4 among the said Refinery proposals. The figure 2 refers to the number assigned to KNPC. Other Company Departments are assigned the following numbers: 1 for HO including General Services, 2 for SHU Refinery, 4 for MAB Refinery, 5 for Local Marketing and 6 for Safety, Health & Environment. Once this budget reference has been assigned for a capital project proposal, this reference must not be amended or re-issued even if the project concerned has been cancelled or completed.
Category : Each project proposed has to be classified into one of the following,
categories in accordance with its principle objective:
o A. Maintaining present position
o B. Improving profitability (reduction in cost energy saving or increased revenue).
o C. Statutory and safety requirements or social responsibility including environmental constraints.
o D. Others, if any (to be specified).
Section 2: Identify the business challenge and Project’s business objectives
Section 2.1: Business Challenge
The purpose of a Project is to solve a business challenge. A business challenge is a question, issue, or situation facing the organization which needs to be answered or resolved. In this section, state in specific terms what problem or issue this Project proposes to resolve. Some examples of challenges could be
- Extensive manual process with very little automation - Low efficiency level in a process unit etc.
- Market opportunity and/or customer requirements
The objective is to provide a clear understanding of why the Project is being proposed. Section 2.2: Business Objectives
The Project’s business objectives must identify what the Project will achieve. They should reflect the Project’s desired results in answering or resolving the stated business challenges. Some examples of business objectives are
- Improved productivity
- Enhanced control and improved audit trail through use of automation - Reduced attrition rate
- Improved skills due to focused training etc. - Fulfil specific customer requirement
- Provide competitive advantage by responding to market opportunity
Section 3: Provide Project overview
Section 3.1: Preliminary Project Scope Statement
The preliminary Project scope statement describes the work that is needed to produce the benefit that the Project aims to achieve. This initial Project scope statement provides the foundation for further refinement and clarification during subsequent stages.
A well-written scope statement clearly defines what the Project will and will not aim to accomplish in order to enable maintaining focus on the achievement of desired results.
In the project scope section, sufficient details should be provided covering all the main aspects of the project, particularly the following:
• High level scope of work
• The technology or process involved, where applicable • The envisaged implementation and contracting plan • Comparison with existing facilities (for replacement items)
• For projects involving purchase items, the number / quantity of each item to be provided, where applicable
• Data regarding dimensions of buildings, lengths of piping and cabling, capacities of main equipment, etc., where applicable
If the proposal has been the result of a preceding project study, the relevant study report or its executive summary is to be attached.
Section 3.2: High Level Approach
The high-level approach outlines how the Project will approach solving the business challenge. This should include an identification of the nature of the proposed Project solution (i.e. procedural, skill, technology, etc.).
Section 4: Identify the business impact
Given their transformative nature, all Projects have some degree of impact on the business. In this section, the Project’s business impacts are analyzed from two perspectives. First, determine the impact of the proposed Project on specific segments of the workforce by organization level and department/division. Second, describe the overall business impact of any proposed new business processes.
This understanding of the potential solution’s impact on current business processes and the degree of organizational change required will help gauge the anticipated level of stakeholder resistance. The methodology’s Stakeholder Profile tool will analyze and plan for this resistance in further detail.
Section 4.1: Organisational Impact
In this section, the Project initiator needs to identify the specific organisational units that are impacted by the change.
The impact could be on processes, procedures, skills, competencies, IT systems etc... Based on the nature of impact identify the departments/divisions and the organisational levels that are impacted by the change.
Section 4.2: Business Process Impact
Based on the change that would be brought about by the Project, identify the business processes that will change and its impact on the business.
Some examples of business processes and its impact are illustrated below, the context is a new functionality upgrade in the Maximo system which impact how spare parts are ordered:
Business Processes Impact on Business
Spare parts ordering process - Change in functionality will mean additional approval required to order spare parts Approval process for indents
raised
- In order to improve control over orders placed, the indent creator cannot approve it himself. It needs to be approved by another person
Section 5: Align with KNPC Strategic Objectives and Balanced Scorecard
Section 5.1: KNPC Strategic Objectives Supported
All proposed Projects should align with KNPC strategic objectives. This aims at ensuring that the Project is consistent with Management’s on-going strategic vision for the organization. In this section, offer a brief explanation for how this Project will support each applicable strategic objective. If the Project does not support a strategic objective, provide an explanation for why the Project is being proposed.
Section 5.2: KNPC Balanced Scorecard Measures Impacted
All proposed Projects should be consistent with KNPC’s Balanced Scorecard. In this section, cite the specific measures in the scorecard that will be impacted by the Project. Again, if the Project does not support KNPC’s Balanced Scorecard, provide an explanation for why this Project is being proposed.
Section 6: Identify estimated costs and Project Resource Requirements
Project execution requires the consumption of resources including funding, personnel, facilities and equipment. This principle goal of this section is to provide Top Management with estimated costs involved for the Project in the Study stage.
Section 6.1: Estimated Cost
Identify the Project’s estimated cost for the Study stage. This cost estimate must be shown in Kuwaiti Dinars. The estimated cost is to be based upon the scope of work defined.
The study costs will include and is not limited to:
Consultant support
Benchmarking costs, where applicable
Feasibility study / Market survey to be commissioned etc.
In addition, if available, provide details regarding the view on total estimated cost for the entire Project. This entire Project estimate will be further refined after detailed studies are completed. As an attachment, sufficient information shall be provided on the basis and assumptions of the project costing to substantiate the cost estimate. The currency exchange rates and the inflationary price escalations shall be in accordance with the Budget Guidelines. This information would be used by corporate planning for budgeting purposes.
Provide yearly phasing for the estimated expenses for the Study Stage.
Section 7: Consequences and Key Assumptions
Section 7.1: Consequences if Proposal is not adopted:
This section captures the effects on the Company's business if the project proposal is not adopted. For instance, the effect of one or more year's delay in project implementation on Company's operations and operational goals are to be clearly stated.
Section 7.2: Key Assumptions
Highlight any major assumptions that have been made while preparing this document. Include assumptions around start date, number of resources required, and availability, cost estimates, etc.).
Section 8: Signatories
The Project Initiator will prepare the Project Proposal and obtain internal go-ahead from his Department Head. After which the Project Proposal template will be forwarded to Management Support Department.
Management Support Department will prepare its assessment and review it during the Idea Stage Gate Review with CEO and DCEO’s. On obtaining their in-principle approval the sign-off sheet would be signed with the relevant remarks and sent back to the Project Initiator to finalise.
Upon completion, the Project Initiator provides the document to the Management Support Department to facilitate final approvals, including CEO sign-off.
3.0 Additional Considerations
Ensure sponsor and executive ownership of the Project Proposal
Spend time with stakeholders. Identify key influencers and decision makers. Define the business outcomes with their participation. Define and agree on all assumptions to prevent future issues and confusion